Bank of Cyprus, the island’s largest lender, has completed a 1 billion euro ($1.34 billion) capital increase in a private placement to help it restructure following a haircut on deposits last year.

BoC announced late Monday the successful placement of 4.2 billion new ordinary shares at a price per share of 24 euro cents.

“Shares were allocated to a broad range of institutional investors from Europe, North America and Russia, including a number of international investors introduced by WL Ross & Co LLC and the European Bank for Reconstruction and Development,” BoC said.

Existing shareholders will be able to acquire up to 20 percent of the shares offered in the private placement scheme, with the initial allocation adjusted in line with their subscriptions.

The increase will take the bank’s core Tier 1 capital to 15.1 percent from its present level of 10.6 percent.

BoC said the capital injection will help it restructure more quickly, withstand upcoming EU bank stress tests and help stimulate a recovery of the recession-hit Cyprus economy.

“The success of the private placing demonstrates the confidence that international institutional investors have in the Bank’s turnaround and the economic recovery in Cyprus, only a year after the bank exited resolution status,” said BoC CEO John Hourican.

He said it was the biggest single foreign investment in Cyprus.

American billionaire investor Wilbur L. Ross said in a statement: “We are pleased to assist with the introduction of international investors who are committed to buying about 40 percent of this placement.

“This country had been thriving prior to the European financial crisis and we believe it is well on its way toward recovery,” he added.

Cyprus agreed in March 2013 to a 10-billion-euro rescue package with the European Commission, European Central Bank and International Monetary Fund to bail out its troubled economy and oversized banking system. [AFP]